Network Services: Procurement and the Role of Service Providers


This is another piece in the “Road to Mobile World Congress” blogs. First part is here.


One of the choices in the move toward deploying solutions “as-a-service” is how something fundamental like network and services will be delivered. Unlike software, it’s obvious that some equipment is necessary at all locations, but as we have seen in the role of virtual CPE (vCPE), it’s possible to have much of the intelligence pushed out to the central office or to the cloud as virtualized services. 

SD-WAN is one of the areas where these two worlds intersect, as service chaining and ability to run network services in the cloud enables an end-to-end solution where a variety of services are offered to SD-WAN customers. Many of these network services such as load balancers/ADCs or firewalls are already offered by either cloud service providers or as virtual network functions from network or security vendors.


But what role do network service providers play? One can argue that in the world of traditional consumer mobile devices, people trust the network provided by the mobile carriers over that of open public Wi-Fi, as there’s less chance of eavesdropping or rogue Wi-Fi access points. Of course, there are issues related to limits of the data plan or coverage, but if you have sufficient connectivity, carrier networks offer a smooth experience. There are no “captive portals” to accept a service agreement, for example, that one sees at hotels or coffee shops.


ESG has conducted a survey in 2017 to determine the organization’s preference for procuring network services such as bandwidth, security, and authentication. The results and report are not finalized yet, but we find in our early results from 300 respondents that the three models were more or less equally chosen:

  • Purchase a full stack of network services from a single vendor (e.g., AT&T and Verizon).
  • Purchase disparate, best-of-breed network services to be integrated by a third-party managed network service provider.
  • Purchase disparate, best-of-breed network services to be integrated by their own organization.


This shows that some sets of needs are best be satisfied by different procurement models. What we want to determine is whether there is a correlation between company size, industry, or some other attribute with these purchasing models.


As fast LTE and 5G speeds offer viable alternatives in bandwidth and latency, and as fixed-line providers deliver more flexibility in network function virtualization, the line between traditional IT networking and service providers starts to blur. The issue is whether a one-stop provider can satisfy the needs of traditional enterprises on mobile as well as fixed-line networking, especially on the remote office use cases, such as small retail kiosks.




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Topics: Networking Enterprise Mobility